1.

1 INTRODUCTION OF STUDY
The project work is done on the topic customers opinion about loan products
of Sutex Co-operative bank limited. In this we give the brief description on the
customer of the bank like, kinds of customers, awareness of customer about
loan, loan products provided by the bank to the customers, types of the loan
and so on.

This project goes by initially explaining the introduction part about the loans.
Next portion cover is the banking industry profile which includes the overview
of the Global banking industry and Indian banking industry. It includes global
scenario, national scenario, state scenario, PESTEL scenario, major players
etc. It also includes all bank like government bank, co-operative bank, private
bank, public sector bank, and so on.

The company profile of Sutex Co-operative bank ltd. Is being included in this
report to know much about the company and to highlights it main area.
Company profile includes the history of the company, board of directors,
branches, organization structure, services offered by bank.

This project also includes the review of literature. It includes different author
with different opinion and helps to making this project. This literature review
covers from different-different research papers.

The objective is to know about the services provided by the Sutex Cooperative Bank and the customer satisfaction from the retail loan and to know
the different types of retail loans preferred by different sets of customers. The
research has been taken based on the descriptive research design and
sampling method. The sample size is 300 respondents. These research
studies primarily depend on primary and secondary data collection and the
1

will be collecting with the help of structured questionnaire. Data analysis will
be tabulation and using for simple percentage analysis and graphical
representation with the help of SPSS technique.

In this project on the basis of research methodology we will analyze the data
using different tools and techniques. It will also include findings on the basis of
data analysis and also include conclusion and recommendation.

The expectation of the customer will be analyze for loans. There is

comparison of no. of male who have taken loan and no. of female who have
taken loan.

BANKING INDUSTRY PROFILE

2

2.1 GLOBAL SCENARIO OF BANKING INDUSTRY

The Global Banking Industry has been hit hard in recent years due to the
maelstrom of the crisis that affected all financial industries in recent years.
The global banking industry did recover in 2010, with revenues increasing
markedly and profits also growing in proportion. In 2010, the global banking
market generated revenues of around $3.8 trillion, with global banking profits
hitting over $700 billion. Notably, revenues from banks in emerging markets
grew strongly, with revenues up nearly 20% in India, 18% in Brazil and 14% in
China.
However, there came a crisis in the global banking industry in the summer of
2011. The share prices of banks were falling and a number of indicators
indicated little confidence in the prospects of the global banking industry.
Nearly half a decade after the start of the global financial crisis, the banking
system remains under pressure, amid a combination of regulation,
technological change, and macro volatility. While banks have improved the
health of their balance sheets, they are still some way from achieving a model
capable of producing robust and sustainable returns. Banks face a multitude
of structural challenges, many of which are unlikely to dissipate any time
soon, while revenues are still below pre-crisis levels. Banks in developed
markets are failing on average to earn their cost of equity. On 15 the key
metrics of capital efficiency, revenues and cost much work remains to be
done. The global banking sector has made some progress over the past year
towards stabilizing after the financial crisis. Banks have launched numerous
initiatives to improve capital efficiency, revenues, and costs. However, the
impact was not reflected in 2011 earnings, due to the combined impact of low
interest rates and tightening capital requirements.
Further, the sector faces some difficult choices going forward as it strives to
improve performance and regain the confidence of investors and society.
3

Amid tighter regulation, shifting customer dynamics and macro volatility, the
search for a sustainable model goes on.

2.2 KEY MARKET SEGMENTS

The world Retail Lending sector was worth close to $31.4 trillion in 2010.
Market growth is expected to exceed a yearly rate of 5% between 2010 and
2015, to reach almost $40.4 trillion. Mortgage Lending represents the leading
market segment, and reached close to $24 trillion in 2010, accounting for
almost 76% of the overall market in terms of value.
The global smart card shipment market is forecast to record yearly growth of
12% between 2011 and 2014. The market is benefiting from Long Term
Evolution rollout worldwide, state support and migration to Euro pay,
MasterCard & VISA (EMV). Secure microprocessor contactless smart card
shipments are expected to record 22% yearly growth between 2011 and 2014.
The global mobile payments market is expected to exceed 1.5 billion
customers by 2012. It is forecast there will be close to 5.5 billion handsets
used in the mobile subscriber sector in 2015. Obstacles to market growth
include the low penetration of contactless terminals and handsets in mature
markets. The world near communication (NFC) payment market is expected
to record close to 70% yearly growth between 2010 and 2014. Market growth
will be fuelled by the increased availability.
The global private banking sector has been seriously impacted by the
economic crisis, following which partnerships, organic growth, and mergers
and acquisitions went into decline. Since 2010, private banks have been
struggling against commoditization. Industry players will continue to
concentrate on customer segmentation, gearing their products to consumer
groups based on factors such as nationality, social status and ethnicity.
Leaders operating in the market include Wells Fargo, Picket, HSBC, UBS,
Credit Suisse and RBC.
4

Figure: 2.1 Global banking market size chart

Source:http://www.companiesandmarkets.com/MarketInsight/Finance-andBanking/Global-Banking-Industry/NI7620
Europe dominates the global banking industry with 43% of total market share.
The Asia Pacific banking industry, however, grew much faster than both the
European and North American regions during 2006-2011 Asia Pacific
continues to possess huge opportunity for industry growth. Rising per capita
income in the region is expected to drive consumer savings and investment in
banking sector. The massive unbanked population in India and China offers
immense opportunity for banking companies.
The North American banking industry is anticipated to grow modestly in the
near term. The Rest of World's industry growth trajectory offers opportunity for
companies to expand their business in those nations. Europe's debt crisis and
the large government budget deficit in the US are expected to reduce
5

government spending, resulting in sluggish short-term economic growth in

both regions. Rising middle class populations and escalating household
incomes in emerging markets provide substantial opportunity for global banks.
Once the crisis settles, global banks will be left with a number of on-going
issues. After the banking crisis, regulation will undoubtedly affect profitability
and will have a secondary effect of making financial products more expensive
to the banks' customers. Banks will also experience a tightening of capital and
funding, a problem caused by investment and credit demand from emerging
markets. Asian banks are likely to achieve 10% revenue growth over the next
ten years, so those that can tap these markets will have a competitive
advantage. Furthermore, the growing adoption of online banking will mean
fewer high street branches but deliver a much better customer experience.

2.3 NATIONAL SCENARIO OF BANKING INDUSTRY

The growth in the Indian Banking Industry has been more qualitative than
quantitative and it is expected to remain the same in the coming years. Based
on the projections made in the "India Vision 2020" prepared by the Planning
Commission and the Draft 10th Plan, the report forecasts that the pace of
expansion in the balance-sheets of banks is likely to decelerate. The total
assets of all scheduled commercial banks by end-March 2010 are estimated
at Rs. 40, 90,000 crores.
That will comprise about 65 per cent of GDP at current market prices as
compared to 67 per cent in 2002-03. Bank assets are expected to grow at an
annual composite rate of 13.4 per cent during the rest of the decade as
against the growth rate of 16.7 per cent that existed between 1994-95 and
2002-03. It is expected that there will be large additions to the capital base
and reserves on the liability side. The banking industry, which is governed by
the Banking Regulation Act of India, 1949 can be broadly classified into two
major categories, non-scheduled banks and scheduled banks. Scheduled
banks comprise commercial banks and the co-operative banks. In terms of
6

ownership, commercial banks can be further grouped into nationalized banks,

the State Bank of India and its group banks, regional rural banks and private
sector banks (the old/ new domestic and foreign). These banks have over
67,000 branches spread across the country.
The Public Sector Banks (PSBs), which are the base of the Banking sector in
India account for more than 78 per cent of the total banking industry assets.
Unfortunately they are burdened with excessive Non Performing assets
(NPAs), massive manpower and lack of modern technology. On the other
hand the Private Sector Banks are making tremendous progress. They are
leaders in Internet banking, mobile banking, phone banking, ATMs. As far as
foreign banks are concerned they are likely to succeed in the Indian Banking
Industry. In the Indian Banking Industry some of the Private Sector Banks
operating are IDBI Bank, ING Vyasa Bank, SBI Commercial and International
Bank Ltd, Bank of Rajasthan Ltd. and banks from the Public Sector include
Punjab National bank, Vijaya Bank, UCO Bank, Oriental Bank, Allahabad
Bank among others. ANZ Grindlays Bank, ABN-AMRO Bank, American
Express Bank Ltd, Citibank are some of the foreign banks operating in the
Indian Banking Industry

Figure: 2.2 banking structure in India

2.4 Banking structure in India

As far as the present scenario is concerned the Banking Industry in India is
going through a transitional phase. The first phase of financial reforms
resulted in the nationalization of 14 major banks in 1969 and resulted in a shift
from Class banking to Mass banking. This in turn resulted in a significant
growth in the geographical coverage of banks. Every bank had to earmark a
minimum percentage of their loan portfolio to sectors identified as priority
sectors. The manufacturing sector also grew during the 1970s in protected
environs and the banking sector was a critical source. The next wave of
reforms saw the nationalization of 6 more commercial banks in 1980.
After the second phase of financial sector reforms and liberalization of the
sector in the early nineties, the Public Sector Banks (PSB) s found it
extremely difficult to compete with the new private sector banks and the
foreign banks. The new private sector banks first made their appearance after
the guidelines permitting them were issued in January 1993. Eight new private
sector banks are presently in operation. These banks due to their late start
have access to state-of-the-art technology, which in turn helps them to save
on manpower costs and provide better services.
During the year 2000, the State Bank of India (SBI) and its 7 associates
accounted for a 25 per cent share in deposits and 28.1 per cent share in
credit. The 20 nationalized banks accounted for 53.2 per cent of the deposits
and 47.5 per cent of credit during the same period. The share of foreign banks
(numbering 42), regional rural banks and other scheduled commercial banks
accounted for 5.7 per cent, 3.9 per cent and 12.2 per cent respectively in
deposits and 8.41 per cent, 3.14 per cent and 12.85 per cent respectively in
credit during the year 2000.

2.5 CURRENT SCENARIO

The industry is currently in a transition phase. On the one hand, the PSBs,
which are the mainstay of the Indian Banking system, are in the process of
shedding their flab in terms of excessive manpower, excessive Non
Performing Assets (NPAs) and excessive governmental equity, while on the
other hand the private sector banks are consolidating themselves through
mergers and acquisitions.
Private sector Banks have pioneered internet banking, phone banking,
anywhere banking, mobile banking, debit cards, Automatic Teller Machines
(ATMs) and combined various other services and integrated them into the
Meanwhile the economic and corporate sector slowdown has led to an
increasing number of banks focusing on the retail segment. Many of them are
also entering the new vistas of Insurance. Banks with their phenomenal reach
and a regular interface with the retail investor are the best placed to enter into
the insurance sector. Banks in India have been allowed to provide fee-based
insurance services without risk participation invest in an insurance company
for providing infrastructure and services support and set up of a separate
joint-venture insurance company with risk participation.

2.6 STATE SCENARIO OF BANKING

In State banking system can be roughly classified into three categories via;
1. Commercial Banking Sector
2. Development Banking Sector
3. Co-operative Banking Sector

10

Commercial Banking Sector

Today the commercial banking system in India may be distinguished into:
Public Sector Banks
State Bank of India and its associate called the State Bank Group
20 Nationalized Banks
Regional Rural Banks mainly sponsored by Public Sector Banks
Private Sector Banks
Old generation private banks
New generation private banks
Foreign banks in India
Non-Scheduled Co-operative banks
Development Banking Sector
Industrial Finance Corporation of India (IFCI)
Industrial Development Bank of India (IDBI)
Industrial Credit and Investment Corporation of India (ICICI)
Industrial Investment Bank of India (IIBI)
Small Industries Development Bank of India (SIDBI)
National Banks for Agriculture and Rural Development (NABARD)
Export Import Bank of India (EXIM)
Co-operative Banking Sector
The Co-operative banking sector has been development in the country to the
supplement the village money lender. The Co-operative banking sector in
India is divided into four components (Co-operative, Private, Foreign and
Nationalize)
State Co-operative Banks
Urban Co-operative Banks
Primary Agriculture Credit Societies
Land Development Banks
Primary Agriculture Development Banks
Primary Land Development Banks
11

2.7 CO-OPERATIVE BANK- OVERVIEW

2.7.1 DEFINITION
A Co-operative Bank is a financial entity which belongs to its members, who
are at the same time the owners and the customers of their bank. Cooperative banks are often created by persons belonging to the same local or
professional community or sharing a common interest. Co-operative banks
generally provide their members with a wide range of banking and financial
services (loans, deposits, banking accounts).
Co-operative banks are deeply rooted inside local areas and communities.
They are involved in local development and contribute to the sustainable
development of their communities, as their members and management board
usually belong to the communities in which they exercise their activities. By
increasing banking access in areas or markets where other banks are less
present - SMEs, farmers in rural areas, middle or low income households in
urban areas - co-operative banks reduce banking exclusion and foster the
economic ability of millions of people.
2.7.2 CO-OPERATIVE PRINCIPLES

1. Open and Voluntary membership- membership in a cooperative shall be

voluntary and available to all individuals regardless of their political, racial or
religious background or beliefs.
2. Democratic Control- cooperatives are democratic organizations. Its affairs
shall be administered by persons elected or appointed in a manner agreed
upon by members. Members of primary cooperatives shall have equal voting
rights on an one-member-one vote principle, while a secondary or tertiary
cooperative shall have voting rights as delegate of members-cooperatives, but
such cooperatives shall have only five (5) votes. The votes cast by the
delegates shall be deemed as votes cast the members thereof.

12

3. Member Economic Participation- members contribute equitably to and

control the capital of their cooperative. At least part of that capital is usually
the common property of the cooperative. Members usually receive limited
compensation, if any, on capital subscribed as a condition of membership.
Members allocate surpluses for any or all the following purposes: developing
their cooperative, possibly by setting up reserves, part of which at least would
be indivisible; benefiting members in proportion to their transactions with the
cooperative; and supporting other activities as a approved by the
membership.
4. Autonomy and Independence- cooperatives are autonomous, self-help
organizations controlled by their members. If they enter into agreements with
other organizations (including governments) or raise capital from external
sources, they do so on terms that ensure democratic control by the members
and maintain their co-operative independence.
5. Education, Training and Information- cooperatives provide education
and training for their members, elected representatives, managers, and
employees so they can contribute effectively to the development of their
cooperatives. They inform the general public-particularly young people and
opinion leaders about the nature and benefits of cooperation.
6. Cooperation among Cooperative - cooperatives serve their members
more effectively and strengthen the cooperative movement by working
together through local, national, regional and international structures.
7. Concern for the Community- cooperatives work for the sustainable
development of their communities through policies approved by their
members.

13

2.7.3 FUNCTIONS OF CO-OPERATIVE BANKS

Co-operative banks also perform the basic banking functions of banking but
they differ from commercial banks in the following respects,
1. Commercial banks are joint-stock companies under the companies act of
1956, or public sector bank under a separate act of a parliament whereas
co-operative banks were established under the co-operative societys acts
of different states.
2. Commercial bank structure is branch banking structure whereas cooperative banks have a three tier setup, with state co-operative bank at
apex level, central / district co-operative bank at district level, and primary
co-operative societies at rural level.
3. Only some of the sections of banking regulation act of 1949 (fully
applicable to commercial banks), are applicable to co-operative banks,
resulting only in partial control by RBI of co-operative banks and
4. Co-operative banks function on the principle of cooperation and not
entirely on commercial Parameters

2.8 PESTEL ANALYSIS OF BANKING INDUSTRY

Political / Legal Environment
1. The Indian banking Industry is mostly dependent on the monetary policy
decided by the RBI
2. Stricter regulations with respect to capital and liquidity directly affect the
business of banks
3. Banks need to adjust their interest rates accordingly, which may or may not
favour them
4. Banks are forced to lend as per the guidelines of RBI, that includes credit
growth in all sectors
5. Budgetary Measures announced by the government at the beginning of
every financial year also lay down guidelines to banks to lend or accept
deposits
14

6. The government can also increase credit in particular sectors such as

increase in farm credit, increase in infrastructure credit etc. (priority lending)
7. Sometimes the government gives debt waivers to certain sections of the
society that need to be adhered to by banks as well.
Economic environment
1. Economic factors in the country also affect the Banking Industry both
favourably or unfavourably
2. When the economy is in good shape in terms of high per capita income,
good agriculture harvest and normal inflation, banks have an edge as people
are left with more money to deposit them with banks
3. This helps in more capital formation as more deposits can be realized
4. Also In the times of economic boom, more and more FDI is brought into
India through banking channels, that actually improves business for banks
and the economy in general
5. Economic prosperity encourages lending business for the banks but in
times of recession banks face tough times to recover their money, issue fresh
credit and NIMs is lower too.
Socio Cultural Environment
1. The Indian banking system has been progressing rapidly. There are still
several untapped rural markets, despite the large number of banks in India
2. Many farmers still take loans from moneylenders at a very high interest rate
and small-scale industries continue to remain important for banks
3. However changes could be expected in the near future for the unorganized
sector
4. The growing population of India is a great opportunity for Indian banks as a
lot of people in the country want to open a bank account and develop good
savings habits

15

5. Changing lifestyle of the Indian urban population who wants easy ways of
financing to their desires
Technological Environment
1. Indian banking has been consistently working towards the development of
technological changes and its usage in its operations
2. With the application of new and improved technologies banks are expected
to reduce costs, time and provide higher customer satisfaction
3. Internet banking or banking via the phone can be considered a remarkable
development in the banking industry
4. Mobile banking enables customers to check their account balance, transfer
funds 24x7, bill payments, booking of bus/flight tickets, recharge prepaid
mobile and do a lot more effortlessly and securely
5. Banking through cell phone benefits the banks too. It cuts down on the cost
of in-person banking and helps reduce headcount at branches
6. Technological developments facilitate the flow of information and data
faster leading to faster appraisal and decision-making as well.

2.9 MAJOR PLAYERS OF BANKING INDUSTRY

Bank of Rajasthan
Catholic Syrian Bank
Bank of Punjab
Dhanlakshmi Bank
HDFC Bank
Karur Vysya Bank
ING Vysya Bank
Laxmi Vilas Bank
Karnataka Bank
South Indian Bank
United Western Bank
UTI Bank
Centurion Bank
16

3.1 PROFILE OF THE SUTEX CO-OPERATIVE BANK LTD

SUTEX BANK HISTORY PROFILE

The Sutex Co-operative Bank Ltd. has started on 15th May, 1972 . At the
prime time of opening Sutex Bank its name was The Surat Textile Traders
Co-Op. Bank Ltd. Banks registered office address is Surajram Bachkaniwala
Bhavan, Nr.Navjivan Circle, Udhana Magdalla Rd. Surat. In the year 1972
Banks Establisher Chairman Late Mr. Surajram Bachkaniwala and Vice
Chairman Late Mr. Ashabhai Shankarbhai Patel having a prosperous vision to
provide a golden & profitable market to Surats Textile Industry, registered the
Bank at a cooperative level. Sutex Bank provided services with a view to help
Surat Textile Market shop keepers with banking facilities and helps them start
and manage their businesses.
Sutex Bank in the initial stage started with only 270 share holders and Rs.
1.10 lacs share capital. As on 31st March 2012 number of shareholders
crossed 22452 and share capital of Rs. 1732.22 lacs. As on 31st DEC 2011
Bank has crossed a total deposits of Rs. 717.54 crores and total advances of
Rs.479.99 crores. Sutex bank has in total 14 branches and an administrative
office the bank started with only four employees and as on today it has big
circle of 214 employees. Bank has been providing up to date training to all
employees of different levels. All Sutex Bank branches are well organized and
completely computerized and is one of the leading Banks across South
Gujarat. Sutex Bank was the first Bank to provide ATM facilities through co17

op. sector to its customers. In Surat City Bank provides complete Core
Banking Facilities to its customers. It may be noted that the Core Banking
Solution was completed in just 3 months period which included 14 branches
and a admin office which showed a positive approach and proof of
determination of Sutex Banks Staff. With CBS facilities Banks valued
customers now can avail all kinds of Banking service and facility from any
branch.
The Bank considers its customers as a valued customer and provides top
level banking services which has made the Bank very popular among the
customers. Due to this Banks deposits has always increased. Countrys
economic changes, inflation, share market drips ,yield on High interest rates
in mutual funds had very less effect on the Bank which can be seen viewing
the numerical charts.
Bank leads not only in providing Banking facilities but also is very active in
social services. As we know our Surat has been hit several times by natural
calamities like floods where Bank has instantly helped its customers without a
delay. During the Floods in Surat in the years 1994, 1998 and 2006 Bank
provided Loans to those who took severe damages within 24 hours which was
noteworthy.
Under the TUF scheme Bank has advanced a total of Rs.400 crores and has
helped receiving fast subsidys to its shareholders which has resulted in
strengthening our countries overall economy. For this achievement Bank has
received an honourable certificate by the Ministry of Textile.
Currently Bank provides all kinds of banking facilities including CBS, Estatements, SMS alerts, RTGS/NEFT, E-payments etc.

18

3.2 BRANCHES
Branch
Administrative

Location
Mr. Kershasp

Office

Wadia - Incharge 2632029

C.E.O

2nd

Ph.no.
T. +91 261 2632027 +91 261

Floor,

Surajram
Bachkaniwala
Bhavan, Nr.Navjivan
Circle,

Udhna

Magdalla Rd., Surat395017,

Textile

Gujarat

(INDIA).
Market Mr.
Manoj

(main office)

K +91

261

Oliawala - Branch (Manager)

2343948
+91

261

Manager 2nd Floor., 2343954 (Clearing)

Bank Block, Surat +91 261 2343949 (Loan)
Textile Market, Ring
Station

Road, Surat-395002
Mr. J.R.Shah +91 261 2402736 +91 261
Incharge Manager 2402737
Meghani
Gr.

Gopipura

Flour

Mansion
Station

Road, Surat-395003
Mr. P.D.Makhania +91 261 2593059
Incharge Manager +91 261 2593463

Katargam

Subhash

Chowk,

Gopipura,

Surat-

395003
Mr. Shital Bhatt - +91 261 2407876 +91 261
Incharge Manager
163-B,Old

GIDC,

Katargam,
Table: 3.1: Branches of bank

3.3 BOARD OF DIRECTORS

19

Sr.No.
1

Name
Mr.
Nirmalbhai

Position
V. Chairman

Vakharia
Mr.
Nimeshbhai

S. Vice Chairman

3
4

Bachkaniwala
Mr.Kamalvijay R. Tulsian Executive Chairman
Mr. Ravindrabhai B. Secretary

Dholabhai
Mr.
Prabhatsinh

F. Secretary

6
7

Solanki
Mr. Arun B. Kanodia
Mr. Jyotindrabhai

Secretary
B. Director

Lekhadia
Mr.
Manharlal

R. Director

Bachkaniwala
Mr.
Hasmukhlal

B. Director

10

Mistry
Mr. Sharadchandra C. Director

11
12
13
14
15

Kapadia
Mr. Raj M. Kapadia
Mr. Kartik U. Hathiwala
Mr. Ashvinbhai J. Desai
Mr. Jitendra M. Naik
Mr.hikhubhai Mohanbhai

Director
Director
Director
Director
Director

Desai

Table: 3.2: Board of directors

3.4 ORGANIZATIONAL STRUCTURE

Chairman

Vice Chairman

Secretary
20

Chief Executive Officer

Personnel Manager

Manager

Officer

Clerk

Peon & other staff

Figure: 3.1: Organization structure

3.5 SUTEX BANK SERVICES

1. Real Time Gross Settlement / National Electronic Fund Transfer
RTGS/NEFT is one of the safest secure modes of fund transfer.
Credits the beneficiarys A/c the same day through RTGS.
Credits the beneficiarys A/c the same day/next day if remittance done late in
the day.
21

For RTGS Eligibility: Transactions above 2 Lacs.

For NEFT Eligibility: No Limit
2. Lockers
Sutex Bank provides Safe Deposit Locker facilities to keep your valuables at a
safe and secured place. Availability of Lockers in various sizes and
dimensions
Branches with Locker facilities:
Gopipura Branch
Katargam Branch
Rander Rd Branch
Udhna Magdalla Branch
Athwalines Branch
Parvat Patia Branch
Citylight Branch
Salabatpura Branch
3. SMS Alerts
Sutex Bank SMS Alerts provides both push modes as well as pull mode
facilities. Once registering for our SMS alerts services customers shall receive
various premium alerts such as,
Pull Mode Alerts
Balance Inquiry
Last Five Transactions
Loan A/c Last Five Transactions
Cheque Status
Loan A/c Balance

22

Push Mode Alerts

Cheque Returns
Balance Minimum & Maximum Alerts
Birthday & Anniversary Alerts
Account Transaction Alerts
RTGS / NEFT Alerts
SMS Alerts Sending Formats
Type BAL space A/c No for Balance of Account
Type TRN space A/c No for Last 5 Transactions
Type LNT space A/c No for Loan A/c Last 5 Transactions
Type CHQ space A/c No-Cheque No.
Type LNB space A/c No for Loan A/c Balance

4. ATMs
Sutex Bank was the first Co-operative bank in Surat to provide ATM Services
to its customers. They offer the best of repay card services where in all ATM
transactions can be performed from 80000 ATM's across India.
Sutex ATM Services:
Cash Withdrawal
Fast Cash
Balance Inquiry
Mini Statement
Pin Change
Sutex ATM Branches:
23

Rander Road
City Light
Udhna Magdalla
5. E-Payment of Taxes
Sutex Bank Provides facility to their customers / taxpayers to make Epayments of all direct taxes Customers can avail this facility from any bank
branch of Sutex Bank. All transmission are processed through NSDL-TIN
website which are encrypted with Secure Socket Layer (SSL) authentication.
6. Sutex Stamp Franking Service
Sutex bank provides government authorized adhesive stamp franking
services.
Branches with Stamp Franking Facilities
1. Administrative Office
2. N.T.M Sahara Darwaja

3.6 SWOT ANALYSIS

Strength

Consistent Dividend Payment @15% since

1994-95.
Stamp Franking Facility available.
Safe Deposit Lockers available at 8 Branches
& ATM facility at 3 Branches.
Attractive Deposit Schemes such as (i) Kanya
Utkarsh& Children Growth (ii) Swarnim Gujarat
24

Scheme.
Loans & Advances at Competitive Rates on
easy repayment terms. Special Scheme for
Professionals i.e. Doctors, C.A., Architects etc.
RTGS Instant Funds Transfer facility anywhere
in India.
With 23362 members and 218 employees in
their attendance growing from strength to
Weakness

strength.
Absence of professionalism

Opportunity

Too much documentation

Diversification of activities helps for survival
and growth.
The

need

for

improving

professional

competence of the employees

Customized loan

Table: 3.3: SWOT analysis

3.7 MEANING OF LOANS

Under the loans, credit is given for a definite purpose and for a predetermined
period. Normally these loans are repayable in installments. Funds are
required for single non-repetitive transactions and are withdrawn only once. If
the borrower need funds again or wants renewal of an existing loan, a fresh
request is made to the bank. This borrower is required to negotiate every
time; he is taking a new loan or renewing an existing loan. Banker is at liberty
to grant or resources and credit policy of the control bank.
3.7.1 TYPES OF LOANS
25

Bank grants loan for different periods short, medium and long and for different
purposes.
1. Short Term Loans
2. Term Loans
3. Composite Loans
4. Retail Loans
a
b
c
d

Housing Loans
Education Loans
Auto Loans
Personal Loans

3.7.2 ADVANTAGE OF LOANS

1 Financial discipline of the borrower
As the time of repayment of loans or its installments is fixed. In
advance, these systems ensure a greater degree of self discipline of
borrower as compared to cash credit system.
2 Periodic review of loans A/C
Whenever a loan is granted or its renewal is sanctioned, the banker
gets an opportunity of automatically reviewing the loan account.
Unsatisfactory loan may be discontinued at the discretion of the
banker.
3 Profitability
System is comparatively simple, interest occurs to the bank on the
entire amount lent to a customer.

3.7.3 DRAWBACK OF LOANS

1 Every time loan is required. It is to be negotiable with the banker. To
avoid it, borrower may borrow in excess of their exact requirement to
provide for any contingency.

26

2 Bank has no control over the use of fund borrowed by the customers,
however banks insist on hypothecation of the asset/ vehicle purchase
with loan amount.
3 Though the loans are for fixed period but in practice they roll over i.e.
they are renewed frequently.
4 Loan documentation is more comprehensive as compared to cash
credit system.

3.8 Scenario of loan

1) RETAIL LOAN
A retail loan is similar to a mortgage loan required to buy a real estate
property. The primary difference is that mortgage loan secures a
residence, whereas a retail loan secures a commercial retail property.
Banks and private investors can supply funding for a retail location, such
as a stand-alone retail store or a strip mall. Various details play a role in
the approval process, and lenders use numerous factors to determine the
interest rate on a commercial retail loan.
Retail loans are those which are given by the banks to individuals so as to
meet there personal needs, retail loans are smaller in size as compared to
corporate loans.
Loan become necessary for every money minded person. From this way
they can invest their money in other profitable purposes. The best coming
way to get loan for building home for buying automobiles or education of
your for personnel purposes is provided by Sutex Co-operative Bank Ltd.
At preferential rate of interest. If you are eligible for loan then you will have
money in hand in very few days. The bank will provide you the facility of
re-payment in easy installments the loan are made available at your
doorstep

27

2) Housing Loans- Most individuals take housing loans and when it comes to
retail loans, housing loans is right there at the top. Banks give housing
loans to individuals so that can buy apartment or construct new house if
they already have the land.

Limit

per

Maximum Limit Rs.70.00 Lacs

Borrower:
Margin Money:

20% of Sale Deed or

25% of Construction Contract

No. of EMIs:

84 to 120
(B.O.D. reserves right to change according
to repayment capacity of applicant).

Rate of Interest:

12.50%
84 Months : 11.50%
120 Months : 12.00%

Guarantors:

One guaranter (who holds property)

Collateral

25% Life Insurance Policy of Loan Amount.

Security:
3.8.1 Housing Loan details
3) Educational Loans- Money borrowed to finance education or school
related expenses. Payments are often deferred while in school and for a sixmonth grace period after graduation. One of the major benefits of these types
of loans is that they come with low interest rates and do not require collateral
or a credit check.

28

Limit

per

Maximum Limit Rs.20.00 Lacs

Borrower:
Margin Money:

15% of Quotation Amount.

No. of EMIs:

60 (commences after completion of course)

(B.O.D. reserves right to change according to repayment

capacity of applicant).
Rate of Interest:
Upto Rs.2.00 lacs
Rs.2.00

9.50%

lacs

to

10.50%

Rs.5.00 lacs
Above Rs.5.00 lacs

11.50%

Foreign Country

11.50%

Guarantors:

One guarantor (who holds property)

Collateral Security:

Upto Rs.3.00 Lacs Loan, 50%

FD/NSC/KVP/Insurance Policy. Above
Rs.3.00 Lacs Loan, Immovable Property
with 100% valuation or FD/NSC/KVP/Life
Insurance Policy.

3.8.2 Educational Loan details

4) Vehicle or auto Loans- This type of loans are given to individuals who are
looking for buying cars whether new or second hand, auto loans are also
given for two wheelers to individuals.

Limit per Borrower

1 ) For Personal Use:

Maximum Limit Rs 35.00 Lacs

29

2) For Commercial Use:

Maximum Limit Rs 100.00 Lacs
Margin Money:
Four wheeler:
15% of Proforma Invoice
Two wheeler:
20% of Proforma Invoice
Three wheeler:
25% of Proforma Invoice
No. Of EMIs:
Four wheeler:
50 to 60
Two wheeler:
50 to 60
Three wheeler:
36
Commercial Use:
36
(B. O. D. Reserves right to change according to repayment capcity
of applicant).
Rate of Interest:
Guarantors:
Collateral Security:

12.00%
Two guarantors (who holds property)
Property Mortgage in case of

Commercial Vehicle.
3.8.3 Vehicle or Auto Loan details
5) Personal Loans- Personal loan are the loans which are given to
individuals for purposes such as marriage, travelling to abroad, loans for
covering hospital expenses and other such loans which individual may need
depending on his or her needs and situations.

Limit per Borrower :

Rs. 45,000.00

Margin Money:
No. Of EMIs:
Rate of Interest:
Guarantors:
3.8.4 Personal loan details

N.A.
50
15%
One (property holder)

Source: http://www.sutexbank.in

3.7 Vision & Mission

Vision
The bank aims to double its business in next 5 years. Expansion plan is there
for opening of 3 more branches in prime locations of the city. Main focus is to
cover the areas which are not covered by adequate banking facilities. The
30

adoption of all modern technologies for better service will be priority of the
bank in future. The environment of all the branches will match an international
standard.
Bank is poised to move towards needs based and behaviour based
segmentation in the next few years. Recounting that the number of mobile
phone users is increasing day by day, bank has already started services of
mobile banking and will shortly commence net banking.
Mission
Our mission is to be a preferred financial service provider with a special focus
on innovative quality products, technical expertise & efficient services for
customer achieve their objectives and goals.

REVIEW OF LITERATURE
Alter (1980), A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. Asserts that, financial institutions
have failed to determine credit worth borrowers simply because they have
inadequate credit policies, failure of bank officers to comply with lending
policies, inadequate customer relations, low staff morale, and bank officers
exposure to fraud.

31

Gupta and Ambegeokar (1986), Changing structure of Industrial

Finance in India, productivity analysis, vol. no. 5. This study observed
that the use of funds from banks by the private corporate sector had
exceeded its inventory formation. Gupta has argued that a small portion to
such finance should have gone to meet fixed investment. Further, he found
the growth rate of physical assets to direct relate to security issues than bank
credit. Hence, he argued that the fast growing firms relied heavily on security
issues than the use of bank credit. Ambegeokar found that the rate of rise in
bank credit exceeded that of inventory, sales and output. Further he observed
that its dependence on banks for working capital had increased, accompanied
by a decline in reliance on other financial institutions.

Gingrich (1989), A Loan Assessment System for Centenary Rural

Development Bank, November, 2005.On the other hand believes that, the
inefficient mechanisms used in assessing loans are attributed by the banks
pessimism about the ability of technology to come up with decisions on who
qualifies and who doesnt. He went ahead to suggest that the failures need to
be closely examined because they reveal deep-rooted weaknesses and
limitations about banks. However, it is by studying failures that we can draw
lessons on how to improve performance.

Shetty (1990),Development of Commercial bank and other institutional

Credit, Asian economic bulletin, vol. no.8 This study assessed the
dimensional changes in credit deployment during the first five years of
nationalisation in relation to changes in output and prices. The rationale for his
analysis was the fact that, in any accepted model of demand for money, one
common variable is the gross national product or some other variant of it in
real terms. Consequently, the hypothesized that credit for any sector or
industry over a period has to have some relationship with its performance in
real terms, particularly output.

32

Krugman, (1990) A Loan Assessment System for Centenary Rural

Development Bank, November, 2005. Noted that the reasons as to why
there was no proper loan assessment in Asian banks, was partly due to
government persuasiveness or order to lend heavily to particular industries
and companies. In other wards they were captive banks. This allowed the
companies concerned to become over leveraged (vulnerable to economic
down town) and directed resources into unprofitable investments hence
affecting the banks performance.
Krugman, (1990) A Loan Assessment System for Centenary Rural
Development Bank, November, 2005.In his analysis of Asian banking
institutions commented that poor loan assessment has resulted into bad
debts, which undermine confidence of banks hence provoking over flows and
weakening of the financial position of the borrower. However he did not
explain the extent to which bad loans affected banking institutions.
Srinivas, (1993) A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. Poor loan assessment is attributed
by poor management of records by banking institutions especially in keeping
records on how the client has been repaying the loans. He went ahead to add
that worse still, most technical assistance providers do not tell the truth to the
clients/ borrowers especially on the loan usage. He however does not express
the mechanisms the Bank may employ to counteract poor loan assessment to
the borrowers.
Kelley et al., (1994) and Zeithaml et al., (1996), A study on an impact on
customer repurchasing and service quality perception, vol. no. 15, may
1990.They creates a study using different tools and techniques and found a
positive relationship between customer repurchase intentions and service
quality perceptions.

33

V.Mahalingam (1995), A study on customer satisfaction towards

Housing Loan in banking sector with reference to corporation banks,
Vol. 25 Issue: 5, pp.214 230. In this project made an attempt to analyse the
consumers awareness over BPL products. The major findings of the study
were BPL, to find out the consumer awareness of BPL products in
Coimbatore. For studying the objectives, primary data was collected from 100
samples by adopting the method of convenient sampling. The major findings
of the study were quality, prestige, convenience, technology; company image
and aesthetic sense were the important reasons for buying BPL products.

The Clinical (1996), A study on gender wise impact on banking

transaction, business management, vol. no. 7, January 1996.That the
implementation of the customers of banking transactions is less due to the low
income and other social barriers. Found to be influenced by the role of gender
by cultural factors, social and religious. Gender is creates more impact on
banking transaction.

Metawa Almossawi (1998) Customer Perception Regarding Car Loans

in Islamic and Conventional Banking International Journal of Learning
& Development, ISSN 2164-4063 2012, Vol. 2, No. 6. The behaviour of
banking customers of Islamic banking in Oman through the collection of data
from 300 customers. It aims to know the awareness and level of customer
satisfaction among Islamic banks by looking at demographic characteristics.
The results showed that we are satisfied the great majority of customers with
products and services of Islamic banks.

Metawa Almossawi (1998), Customer Perception Regarding Car Loans

in Islamic and Conventional Banking International Journal of Learning
& Development, ISSN 2164-4063 2012, Vol. 2, No. 6 The behaviour of
banking customers of Islamic banking in Oman through the collection of data
from 300 customers. It aims to know the awareness and level of customer
satisfaction among Islamic banks by looking at demographic characteristics.
34

The results showed that we are satisfied the great majority of customers with
products and services of Islamic banks.
Burki and Perry (1998), A Loan Assessment System for Centenary Rural
Development

Bank,

November,

2005.

Financial

system

Stability

Assessment .Washington D.C (97) are of the same view like Alter and they
indicate that fraudulent practices may create risky or lead to off-balance sheet
operations and are a moral hazard to the bank. This is particularly true
especially if officers want to gamble for survival, but this happens if they are
aware that their loan assessment system is poor and hence have nothing to
fear.
Burki and Perry (1998) A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. Assert that the bank owners are
directly or indirectly involved in the weakening of the loan assessment
systems in that they often turn banks credits to finance their own activities
which they in most cases did not pay in time and thus affecting bank
operations. However they did not explain the procedure that can be
undertaken to avoid such loopholes.
Burki and Perry (1998) A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. On the other hand have a different
view. They believe that, poor loan assessment in Asian Banks was as a result
of lack of transparency in regional banking systems, which resulted into failure
in disclosing the true scale of bad debt problems and henceforth weakening
the market discipline on bank management. This reduced the need for them
to face the problems and hence undermining public confidence in banking
systems, which was largely attributed to lack of credible information from
depositors.

Metawa Almossawi (1998), A study on the customer behaviour of Sutex

Co-Operative Bank Ltd, business management, October 1998.The
behaviour of banking customers of Sutex Cooperative bank in Surat through
35

the collection of data from customers. It aims to know the awareness and
level of customer satisfaction among Islamic banks by looking at demographic
characteristics. The results showed that we are satisfied the great majority of
customers with products and services of Sutex Cooperative banks.

Burki and Perry (1998), A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. Argue that, there is a need to
establish strict internal guidelines, which ensures that loans are based on
sound credit analysis if the banks are to realize significant profitability.
However, they did not specify the mechanisms that can be employed. In their
analysis of loans lending, they further argue that banks should not be allowed
to engage in activities which regulators cannot be certain that they can
monitor otherwise, it leads to losses to the bank. This is significant in that it
reduces on unnecessary banks bad debts.

Shetty

S.L

(1998),

Performance

of

Commercial

banks

since

Nationalization, performance management, vol. no. 10, November 1998.

In this study it has observed that, the share of medium and large industry in
total bank credit had declined due to priority sector lending, that growth in
bank credit had always been disproportionate to growth of their physical
output, especially in industries like cotton textiles. His observation particularly
for the years 1975-76 and 1976-77 revealed: In line with these observations,
he suggested policies to scrutinize credit claims vigorously and relate credit to
the genuine production requirement so that funds are not tied up with these
large borrowers.

Lovelock C. and Lapert D. (1999), A study on problems occurs by the

quality of services, performance management, vol.no. 21, may 1999. A
large number of service quality problems result from incidents that occur
between customers and staff, service industries use new technologies more
and more in order to reduce or suppress customer contact. Thus, telephone
conversations have replaced face-to-face contact, and human services are
36

replaced by self-services which often depend on the use of computers and

automations.

Hannig and Mugwanya (2000), A Loan Assessment System for

Centenary Rural Development Bank, November, 2005. Are in agreement
with Hahns observation. They also found out that poor borrowers cannot
provide conventional collateral and therefore micro finance institutions will
have to make use of alternative repayments of incentives such as the denial
of access to subsequent loans. However they do not explain the way of
determining the credit worthiness of the borrower.
K.L. Srinivasan (2000), A study on impact on a marketing of housing
loan, Srinivasan paper, financial institution centre, may 1998. He
concluded that simplification of the documentation process, careful and
friendly approach systems and procedures; good customer service and noninsistence in collateral securities are the most important variable in the
marketing of housing loan schemes by banks.

Brissimiset al., (2001), Factors Affecting Customers Decision for

Taking out Bank Loans: A Case of Greek Customers, Journal of
Marketing Research & Case Studies, Vol. 2012 (2012), Article ID 927167,
16 page, DOI: 10.5171/2012.927167. Banks in Greece have historically
played a dominant role in channelling financial savings from surplus to deficit
economic units, whereas the relative importance of other financial institutions,
such as mutual funds and insurance companies, in financial intermediation
was until recently very limited, but is currently increasing. The special role of
banks in financial intermediation was further enhanced bythe following
features of the financial system.
Almossawi (2001), Factors Affecting Customers Decision for Taking
out Bank Loans: A Case of Greek Customers, Journal of Marketing
Research & Case Studies, Vol. 2012 (2012), Article ID 927167, 16 page,
DOI: 10.5171/2012.927167. Customer demographic characteristics, and
37

mainly age group, are one of the most significant factors, which have been
investigated by several studies. The objective of the present paper is to
identify factors for bank loans demand in a Greek population sample. The
researchers aim to formulate a model which will help banking policies
determine effectively future marketing strategies.
Joseph et al., (2002) A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. Developing the Russian Financial
Sector Central Bank of Russia, Moscow share the same view as above and
adds that, there is a tendency of banking officers to compromise with credit
borrowers and that this largely affects the loan assessment systems since
some of the compromised clients may never repay the loan. The researcher is
in agreement with Joseph simply because, experience shows that when some
of the clients get too used to officers, they may reach an extent of defaulting
expecting officers to pay from their pockets. This has led to an increase in the
portfolio at risk which has also resulted into officers loss of jobs.

James Francis Devlin, (2002) "An analysis of choice criteria in the home
loans market", International Journal of Bank Marketing, Vol. 20 Issue: 5,
pp.212 226. This paper presents an analysis of customer choice criteria in
the home loans market in the UK. In particular, the study investigates the
relative importance of choice criteria according to consumers and also
analyses differences in the importance of choice criteria with respect to a
number of demographic and related factors. A quantitative study drawing data
from 4,200 participants is employed. The study shows that choosing a home
loan institution on the basis of professional advice is the most frequently cited
choice criterion, closely followed by interest rates. Differences in the
importance of choice criteria with respect to gender, class, household income,
educational attainment, ethnicity and financial maturity are apparent.

Joseph, (2002), A Loan Assessment System for Centenary Rural

Development Bank, November, 2005. Argues that since poor loan
assessment systems lead to bank closure and less depositors money, then
38

the government has to come in to set up a financial system to be followed by

banks as well as be able to contain the detrimental impact of bad loans. He
forgot to point out the actual system that can be put in place.
James Francis Devlin, (2002) "An analysis of choice criteria in the home
loans market", emerging market review, vol. no. 15, Jun 2001.This paper
presents an analysis of customer choice criteria in the home loans market in
the UK. In particular, the study investigates the relative importance of choice
criteria according to consumers and also analyses differences in the
importance of choice criteria with respect to a number of demographic and
related factors. A quantitative study drawing data from 4,200 participants is
employed. The study shows that choosing a home loan institution on the basis
of professional advice is the most frequently cited choice criterion, closely
followed by interest rates. Differences in the importance of choice criteria with
respect to gender, class, household income, educational attainment, ethnicity
and financial maturity are apparent.
Khalifa and Liu (2003), Customer Perception Regarding Car Loans in
Islamic and Conventional Banking International Journal of Learning &
Development, ISSN 2164-4063 2012, Vol. 2, No. 6. Measured by the
satisfaction of the perceived disparity between the performance and
perception, such as expectations or desires. There are many factors that
achieve customer satisfaction and quality of service is but one of them.
Bofondi and Gobbi, (2003), A Loan Assessment System for Centenary
Rural Development Bank, November, 2005. Found that overwhelming
banks competition in prices (interest rates) and moreover with imperfect
knowledge of borrowers ability to repay their debts has accelerated poor loan
assessments to potential borrowers. Considering Ugandas banking sector,
Interest rate spreads have been exceptionally high, reflecting high levels of
perceived credit risk, low competition among banks, and inefficiency of the
system. Interest rate spreads have ranged between 15 -20 percent since
1994, while real lending rates have varied from 10-25 percent since 1996.
Non-interest expense is high at 5.8 percent of assets and is passed on to
39

borrowers in the form of high spreads, suggesting inadequate competitive

pressure in the market. However, there are signs of more competitive forces
at play following the privatization of UCBL and its subsequent merger with
Stanbic.
Bofondi and Gobbi, (2003), A Loan Assessment System for Centenary
Rural Development Bank, November, 2005. Point out that the long-term
relationships established between lenders and borrowers are vital features of
most bilateral credit market in that considerable valuable information can be
acquired, implying that incumbents credit worthiness tests may well be more
precise than those of entrants. However they do not explain the extent of the
genuinely of the information collected to determine the credit worthiness of the
borrower.
Kumar, (2004) A Loan Assessment System for Centenary Rural
Development Bank, November, 2005. Besides, he also points out areas
where credit officers have led to the weakening of the system. He observed
that, even if some loan assessment systems may have some weaknesses in
determining the real credit worthiness of the borrower, loan officers have at
times not endeavoured to carry out massive sensitization of loan availability
and how to access it. He notes that there are quite a number of potential
credit customers who lack information on how to access loans. This is
significant in a way that it would minimize the number of bad loan cases and
losses to banks.
Nelson and Chan ( 2005), Customer Perception Regarding Car Loans in
Islamic and Conventional Banking International Journal of Learning &
Development, ISSN 2164-4063 2012, Vol. 2, No. 6. Suggests that the bank
can create customer satisfaction through the integration of trustworthy
behaviour, and proper communication of information, a reflection of a genuine
commitment to provide quality services, and the settlement of disputes and
improve the overall quality of customer relationships

40

Athanasoglou et al., (2005), Factors Affecting Customers Decision for

Taking out Bank Loans: A Case of Greek Customers, Journal of
Marketing Research & Case Studies, Vol. 2012 (2012), Article ID 927167,
16 page, DOI: 10.5171/2012.927167. Domestic banks can be grouped into
two main categories: universal banks (commercial and investment banks) and
specialized credit institutions. A higher banking concentration ratio than in the
rest of the Eurozone makes Greece a de facto oligopoly, allowing the
maintenance of high loandeposit interest spreads
Dr. Anil K. Khandelwal (2006), in his article, Falling on high: Consumers
on a high. Found that things are moving certainly in favour of customers.
Not only have that loans become Cheaper, but they also come with a host of
value-added services including property identification.
Phogal M. (2006), A research article entitled Housing loan frauds in
banks. Some precautionary measures. This article gives the measuring
for the housing loan frauds in banks. The author concluded that housing for all
envisaged 2 million houses every year out of which 0.7 million are in the
urban sector. Government provided certain relief under Income Tax Act. It
motivated many people to avail housing loan. The author thinks that different
frauds committed. I.e. Pre sanction and post sanction. KYC related due
weakness in pre inspection, Benami account, forged title deeds, by selling
same flat to different people, inflated salary certificate, filing of IT return for the
last three years in one lot and particularly by paying a nominal amount of tax,
valuation of the property is manipulated to manage margin money are post
sanction fraud. The precautions may be taken at the bank level to avoid the
assurance of fraud i.e. KYC norms be followed, main salary account should
be verified, loan should be granted against the flat/ houses built by reputed
builders only. An understanding from the builders for not been sold to any
other person, search report of property to be conducted by the advocate,
original title deeds, property tax, electricity bill, kept on records. Disbursement
of loan should be made after spot verification, title deed should be scanned
through ultra violet ray machines before mortgage and bank should be
involved in the process and entire KYC. So the author points out that above
41

mentioned precautions will enable the bankers to curb frauds and public
money can save.

Mishra J.K. and Jain M (2007), Study various dimensions of customer

satisfaction in nationalised and private sector banks. Two-stage factor
analysis is computed to arrive at the dimensions of customer satisfaction. The
study analyses ten factors and five dimensions of customer satisfaction for
nationalised and private sector banks respectively. The study concludes that
satisfaction of the customer is an invaluable asset for the modern
organisations, providing unmatched competitive edge it helps in building long
term relationship as well as brand equity. The best approach to customer
retention is to deliver high level of customer satisfaction that result in, strong
customer loyalty.

J.D Power (2008), A study on customer satisfaction towards Housing

Loan in banking sector with reference to corporation banks, Vol. 20
Issue: 5, pp.212 226. In his study made an attempt to measures customer
satisfaction with home equity lenders. The study finds that there are five key
performance indicators for lenders that are critical to satisfying customer.
These indicators include, approving applications and providing customers with
a access to their fund quickly, setting and meeting and meeting expectations
during the application approval process, avoiding surprising the customer
during the origination process, being versatile and flexible in the location of
the closing.

Gonit Chadha (2008) in his article, Customer services: A paradigm

shift. Says unmatched quality service to customers is currently just a buzzy
word. With all banks offering similar products, service is the key differentiator.
Home loans are no exception in his context where there is a fierce struggle for
competence.

42

Paul Jackson (2008), A study on customer satisfaction towards

Housing Loan in banking sector with reference to corporation banks,
Vol. 28 Issue: 8, pp.204 220. In this study made an attempt to analyse the
overall customer satisfaction. In 2008 averaged 780 on a 1000 points scale,
increasing by 14 points from 766 in 2007. The study found that for consumers
shopping for a home equity loan (or) line of credit lenders, closing cost and
price including interest rate and fees are particularly important consideration.

Alexiou and Sofoklis, (2009), Factors Affecting Customers Decision for

Taking out Bank Loans: A Case of Greek Customers, Journal of
Marketing Research & Case Studies, Vol. 2012 (2012), Article ID 927167,
16 page, DOI: 10.5171/2012.927167. Greek banks were prohibited from
engaging directly in financial service activities other than their traditional loan
and deposit functions. The Greek banking system was subject to strict
regulatory requirements, including restrictions on freely determined interest
rates, the financing of various sectors of the economy and activities in the
foreign exchange market. In the late 1980s, a gradual relaxation of the
regulatory environment in Greece took place due to the increasing
interdependence of EU economies, increasing pressure for the opening of
markets and anticipation of EMU. Administratively determined interest rates
by the Central Bank of Greece were finally abolished and Greek banks
became free to negotiate interest rates with customers based on market
conditions
Rao N. and Tiwari S. (2009), Study the efficiency of 5 public sector
banks. The

study concludes that all employee efficiency factors have

insignificant influence on deposits, assets and advances, from branch

efficiency, only operating profits per branch and from operating efficiency, cost
of deposits have significant and positive impact. Liquidity influencing factors
and ultimate profit factors do not influence deposits, assets and advances
significantly although all profit factors have negative effect. The study also
suggests some measures to improve efficiency.

43

Smail M., Abdullah M.M.B. and Sebastian K.F. (2009), Explore

relationships among service quality features. The empirical data is drawn
from 102 members of an academic staff of a Malaysian public institution of
higher learning using a survey questionnaire. The results indicate that the
interaction between perceived value and responsiveness is not significantly
correlated with customer satisfaction, the interaction between perceived value
and assurance also does not correlate significantly with customer satisfaction
and the interaction between perceived value and empathy correlated
significantly with customer satisfaction. Thus the results demonstrate that
perceived value has increased the effect of empathy on customer satisfaction,
but it has not increased the effect of responsiveness and assurance on
customer satisfaction.

Selvaraj (2011) A Study on Customer Awareness towards Loan

Products & Services in Bangalore with Special Reference to State Bank
of India, October 2013, Volume: III, Special Issue: X. Measured and
analysed the awareness level of the customers towards services provided by
the State Bank of India of Erode district of Tamil nadu. He found that 70% of
the sample respondents had low level of awareness towards the services
provided by the bank. It may be due to the fact that the study area was mostly
covered by rural areas. The bank has to initiate necessary measures to
increase the awareness level through conducting awareness programs in the
rural areas and the bank has to concentrate more on promotional activities.
Sumedha Kalia and Urvashi Kalra (2012) A Study on Customer
Awareness towards Loan Products & Services in Bangalore with Special
Reference to State Bank of India, October 2013, Volume: III, Special
Issue: X. Investigated various factors influencing customers perception and
satisfaction level towards E-Banking. They found that, lack of knowledge,
inadequate legislations and security concerns are the major reasons for not
using E-Banking by the SBI customers. They suggested that, banks should
provide demo on their website for new users to know about online banking

44

services and facilities of experts to increase awareness in the minds of

customers to use e banking safely.
Ravi and Kundan basavaraj (2013) A Study on Customer Awareness
towards Loan Products & Services in Bangalore with Special Reference
to State Bank of India,

October 2013, Volume: III, Special Issue: X.

Analysed the customer preference and satisfaction towards banking services

both private and public banks in Shivamogga district. The authors found
business and vehicle loans are fast moving than other services and overall
satisfaction resulted at 50%. Further, overall satisfaction on bank deposit
schemes resulted positively while other services of banking still need to be
given attention by focusing on customer issues. They authors suggested that,
bankers should work towards 100% customer satisfaction that automatically
fosters customer delight and to sustain customers on a long term basis.

Research Methodology
PROBLEM STATEMENT
A study on Customers opinion about loan products of Sutex Co-Operative
Bank limited.
This study includes,
1. Customer
It includes lower and middle class people who requires the
money from the bank as a loan and repay after the some period of
time.
45

2. opinion of customer
It includes all customers like who borrowed loan from bank in
past, who required the loan from bank in future, who required the loan
from bank in present and so on.
3. loan service offer by bank
It includes different types of loan which are available by bank
and customers are taken from the bank.
4. why customer select Sutex Co-Operative bank.
It includes the opinion of the past customers, interest rates, time
period for repayment etc.

OBJECTIVES
1. To study the Indian Co-Operative bank in general and the Sutex CoOperative Bank Ltd.
2. To find the customers opinion about the loan product of Sutex CoOperative Bank ltd.
3. To find the different type of loans preferred by different sets of
customers of Sutex Co-Operative Bank ltd.
4. To analyze the procedures of loans & advances of the Sutex CoOperative Bank ltd.
5. To compare loan products of various 5 banks in Surat city.

Research design
In this study researcher used Non-probability Descriptive research design. It is
a longitudinal and very effective research design. It is a simplest type of
research and more specific.

Non-probability Descriptive research design

Descriptive research design gives the answer of who, what, when,
where, and how. It concern a univariate question or hypothesis in which
something about the size, form, distribution, existence of the variable.

SAMPLING
46

Sample Selection & Size

Targeted population: people who have a loan facility from Sutex Co-Operative
Bank ltd.
Sample size: 300 customers from public who are already borrow the loan,
who are ready to take the loan, who are taking loan from the Sutex cooperative bank in future.

Sampling Technique
1. After taken it to consider the limitations of this research study
researcher has used the survey method.
2. Non-probability Convenience sampling method.
i. The study area is in Surat in Parle point, Sahara darwaja,
Rander.

Data Collection
There can be two types collected by researcher.
1. Primary data
2. Secondary data
In this primary data will be collected from open-ended and close-ended
questionnaire has being used and administered directly to the customers.
In this secondary data will be collected from the internet, balance-sheet
of bank, annual report of bank, journals.

Tools for analysis

In this analysis used appropriate test with the help of,
1. SPSS
2. Graphs
3. MS-excel
47

4. Frequency

Limitations of the study

1. The project is prepared by student who has limited knowledge and
experience
2. Due to the time limitation many aspects could not be discussed in the
present study.

3. Lack of comprehension of the respondents was the major problem that

created many confusion regarding verification of conceptual question.
4. Every organization has there owned secrecy that is not revealed to
others.
5. While collecting data on the Sutex Co-Operative it is obvious that
personal would not disclose enough information.

Benefits of the study

1. To bank
It is benefited to the bank to know the weakness and strength related to
loan provided by bank.
2. To customer
It is benefited to the customers to know the effectiveness of the
services provided by the bank to the customers.

3. To researcher
It is benefited to researcher for carrying out necessary information.

Scope of the study

1. To study for private sector bank.
2. To study for foreign bank.
3. To study for public sector bank.

48

Bibliography
Reference books :
1. I.M.Pandey , financial management , vikas publication.
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Himalaya

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Websites :
1. Home loan, 18-12-2014,9:45AM
https://www.sutexbank.in/page/12/home-loans
2. Education loan, 18-12-2014,9:47AM
https://www.sutexbank.in/page/25/education-loans
3. Services, 18-12-2014,9:53AM
https://www.sutexbank.in/page/42/services
4. Finance, 18-12-2014,9:58AM
49

Research

https://www.sutexbank.in/page/23/financial
5. Bank history, 18-12-2014,10:05AM
https://www.sutexbank.in/page/14/bank-history
6. Global,1-12-2014,8:00PM
https://www.bankingscenario.in/page/15/global
7. National, 1-12-2014,8:05PM
https://www.bankingscenario.in/page/20/national
8. Current scenario, 1-12-2014,8:20PM
https://www.bankingscenario.in/page/20/current
9. PESTEL, 1-12-2014,8:28PM
https://www.bankingscenario.in/page/20/PESTEl
10. Vision-mission of the bank, 18-12-2014,10:10AM
https://www.sutexbank.in/page/17/vision&mission
11. Board of directors, 18-12-2014,10:20AM
https://www.sutexbank.in/page/18/Board-of-directors
12. Annual report of the bank, 18-12-2014,10:27AM
https://www.sutexbank.in/page/54/sutex-annaul-report-2014
13. Bank project, 18-12-2014,10:32AM
http://www.scribd.com/doc/150116033/Sutex-Co-op-Bank-Project
14. Bank project, 18-12-2014,10:38AM
<http://www.scribd.com/doc/150116033/Sutex-Co-op-BankProject>.
15. MBA project, 18-12-2014,10:42AM
<www.indianmba/Faculty_Column/FC1228/fc1228.html>.
16. SWOT, 1-12-2014,9:00PM
https://www.bankingscenario.in/page/20/swot
17. Journals, 18-12-2014,10:49AM
<www.emaraldinsight.com/journals.htm?articlied=1529011>.
18. Financial institution, 18-12-2014,10:52AM
<www.essay.com/free-finance-essays/the-profitability-of-financialinstitution.php>.

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sutex co-operative bank ltd." business management.

50

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finance in india." productivity analysi 5: 25-30.
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17.Gobbi and Bofondi (2003) "A loan assessment system for centenary
rural development bank.".
18.Gobbi and Bofondi(2005) "A study assessment system for centenary
rural development bank.".
51

19.Joseph et al.(2002), "A loan assessment system for centenary rural

development bank.".
20.Jackson and Paul(2008). "A study on customer satisfaction towards
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system

for

centenary

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25.5: 214-23

53

QUESTIONNAIRE
Analysis of the Demographic Information
Personal Details:
1.
2.
3.
4.
5.

Name :________________________________________________
Age : _________________
Education : _________________
Occupation: _________________
Annual family income
Less than Rs. 300000
Rs. 300000 - Rs. 500000
Rs. 500000 Rs. 1000000
More than 1000000

Questions:
1. What kind of account do you maintain in the bank?
Current
Loan
Savings
2. For how long are you associated with the Sutex Co-Operative Bank Ltd?
(In Month/Year)
3. Have you availed any loan facility provide by Sutex Co-Operative Bank
Ltd?
Yes
No
4. Which kinds of loan do you take from Sutex Co-Operative Bank Ltd?
Personal
Business loan
Education loan
Housing loan
OD loan
Staff loan
Vehicle loan
Machinery loan
Others ______________________________

5. What factor you consider for taking a loan from Sutex Co-Operative Bank
Ltd?
Efficient customer service
Repayment period

Interest rate offered

Security demanded
54

Category of bank/type
Others __________________
6. What are the reasons for not taking loan from Sutex Co-Operative Bank
Ltd?
(Those not taking loan ignore this question)
High interest rate
Biasness
Poor facility
Not giving proper information
7. Which features you like most in loan segment of Sutex Co-Operative Bank
Ltd?
Attractive interest rate
Processing
Transparency
Simple & fast
Less paper work
EMI base loan or an over draft
Specially design product for self employed
Flexibility to choose
8. How do you feel about the services provided by Sutex Co-Operative Bank
Ltd?
Highly satisfied
Neutral
Satisfied
Dis-satisfied
Highly dis-satisfied
9. Which other facility of Sutex Co-Operative Bank you will avail?
Debit card
No. Banking
ATM
Net banking
10. How do you rate The Sutex Co-Operative Bank Ltd?
E= Excellent
VG= Very Good
G= Good
A= Average
P= poor
11. Did you find any drawback in the services provided by Sutex Co-Operative
Bank Ltd?
Yes
No
13. What extra charges charge by the Sutex Co-Operative Bank on loan?
1%
1.25%
1.50%
1.75%
14. Do you satisfied with loan services provided by Sutex Co-operative Bank?
Yes
No
15. What is an Interest rate charge by the Sutex Co-Operative Bank on loan?
10%
11%
13%
15%
16. What are you satisfaction levels from the retail loan practices?
(1= highly satisfied,
2= satisfied, 3= neutral,
4= dissatisfied, 5=
highly dissatisfied)
Variables

Interest rates are

comparatively
lesser
55

Fast

&

services

efficient
of

the

bank work
Bank
employees
co-operation
Repayment period
Reliable

&

transparent
services
Easy

query

handling

17. In terms of the services you received from the lending officer, how
satisfied were you with the following?
(1= highly satisfied,

2= satisfied,

3= neutral,

4= dissatisfied,

highly dissatisfied)
Variables
Friendly

&

courteous manner
Knowledge of bank
retail loan products
& services
Willingness

to

listen & respond to

your need
Fast & efficient
services
Recognition of you
as valued customer
56

5=

Offer of other or
alternative
to

meet

means
your

needs

18. Any suggestion you want to give for the battlement of Sutex Co-Operative
Bank Ltd loan products.
______________________________________________________________
______________________________________________________________

Thanks You
Dharti S. Vankawala & Boney A. Patel

57